If you’re a US resident and you haven’t been to Macy’s, it would be nearly impossible. Some would say that you shouldn’t call yourself a US resident if you haven’t visited its stores. Macy’s is a well-recognized departmental store in the US market.
However, the company offers a wide variety of various brands in its stores. The vast variety offers a lot of options to the customers, and that’s why they would like to visit Macy’s stores. Some people consider the Macy’s stores as the US national stores. Today, we’ll discuss Macy’s swot analysis, which would analyze the strengths, weaknesses, opportunities, and threats.
Macy’s is a US departmental retail chain store, founded in 1858. The brand joined hands with other US big store brands Bloomingdale’s in 1994. The company changed and rebranded its name back to Macy’s in 2007, and it helped the brand to achieve skyrocketing popularity among the public.
Macy’s is home to the top brands in the fashion industry. The reason customers visit its stores is that they know that they would have the access to all the brands under one roof like H&M, Under Armour, Zara, Puma, and others.
The products and services of Macy’s are dining products, home décor products, furniture, kitchen items, and clothes. Besides offering state-of-the-art facilities in its majestic stores, the company also organizes a “thanksgiving day parade.” However, the company started the “thanksgiving day parade” in 1924, and the company has been conducting it annually.
The “thanksgiving day parade” attracts the attention of a lot of people in New York every year. Hundreds of thousands of people come and witness the colorful and vibrant experience of the parade comprising of floats, marching bands, and helium balloons.
According to an estimate, Macy’s annual revenue and sale in 2020 was 17.35 billion dollars in its stores across the US market. The brand has a network of 510 stores in every state across the US, and its total numbers of stores are 570. The total revenue of Macy’s in 2022 was 25.3 billion dollars due to its reputation and popularity. Macy’s swot analysis is as follows;
Strengths of Macy’s Inc.
The internal strengths of the company that are helping the company to move upward are as follows;
Usage of Technology
Macy’s is excellent at employing technology to its advantage, and it has helped the company to expand its business operations. The company is using various social media channels to amplify its sales. According to the company’s CEO Jeff Gennette, the digital sale of the company would reach approximately 10 billion dollars by the end of 2023.
Worldwide reputation, popularity, and publicity is the goal and objective of every brand. In order to make your brand a household name, it requires a lot of good reputation and marketing. Macy’s has worked hard in popularizing its brand name and achieved the status of a household name.
Macy’s has been operating its business since 1858, and the company has established its stores in various states. They have gained a lot of popularity among different demographics of customers through its products and services. It offers a unique competitive edge to its customers.
Marketing and promotional campaigns play a significant to amplify sales and attract the attention of customers. It is not possible to gain a competitive edge in the market. However, Macy’s follows a unique marketing strategy for the promotion of its brand and products/services all over the world.
The company doesn’t spend millions of dollars on digital and printed advertisements like its competitors’ brands. Macy’s organizes the “thanksgiving day parade” and it serves both purposes like the branding of the company and a cultural event.
Macy’s has established an excellent relationship with its customers through its CRM (customer relationship management) program. If you find any problem with purchasing, then the customer service agent would interact with you until the resolution of your problem.
Macy’s is very well aware of the best quality and customer service and values these attributes, and the brand does its best to meet the quality standard criteria of customers. The brand falls under the category of a top retail company in terms of customer satisfaction.
Macy’s offers a wide range of products and services to its target customer market. If you want to buy toys for kids, clothes, home appliances, and furniture, then you don’t have to visit various shops. You can find all types of products and services under one roof.
The wide range of products and services has helped the company to increase its database of customers. When customers visit its stores for shopping, then they feel good in terms of customer shopping experience.
Weaknesses of Macy’s Inc.
The internal weaknesses of Macy’s are as follows;
Market and product portfolio expansion is the most used strategy to increase market share and revenue. As we’re aware of the fact that Macy’s has had a dominating market position in the US in terms of market share for some time, the company couldn’t gain a foothold outside of the US market.
Critically speaking, Macy’s has ignored and wasted a lot of opportunities for market expansion. The retail departmental brand could have amplified its market share to a great extent.
Dependence on US Market
It’s no doubt about the company’s strong market position and high market share in the US market. In other words, the company is heavily relying on the US market, and it makes the company vulnerable to negative socio-economic issues like inflation, poverty, unemployment, etc.
For instance, the company has a network of a total of 787 stores across the world. Out of which 570 stores are in the US market.
When the New York office of Macy’s announced that it would expand its business operations and open up new retail chain stores in the UAE as a part of its expansion. It was joyful news for many overseas Americans to experience their home-based brand in the foreign market.
The company canceled its expansion program a few years later. It disappointed many overseas American that we’re expecting the company to open up its stores there. They have lost trust and confidence in the company that the brand didn’t stand by its words.
Opportunities for Macy’s Inc
The external opportunities available to the company are as follows;
Acquisitions & Mergers
Merger and acquisition is a very good option for Macy’s to buy its competitors. It becomes suffocating for you to run your business in a market surrounded by a lot of competitors. Therefore, Macy’s should consider merger and acquisitions strategies in order to push out competitors from the market. Along with kicking out the competitors from the market, it would also help you to increase the market share and sustain your market position.
Home goods, cosmetics, accessories, and men/women’s clothes are some of the man products that Macy’s has been offering for decades. The offers have helped the company to achieve a significant amount of market share. Macy’s can diversify its product portfolio by offering second-hand clothes, food, beverages, and other products. It would help the company to amplify its revenue stream and expand its database of customers.
Undoubtedly, Macy’s has achieved the market leadership position in the US market, and the brand has gained success in it. It’s the perfect time for the company to expand globally and gain a foothold in the international market. It would help the company to gain popularity, market share, and profitability across the world.
Threats to Macy’s Inc.
The external threats that the company has to face are as follows;
The economic recession is dreadful for the growth of the company. It decreases the standard of living and purchasing power of the people to a great extent. In such an uncertain economic environment, the spending of people drops, and saving increase. International issues like Russia versus Ukraine war and increasing oil prices resulted in the form of inflation worldwide, and it has had a negative impact on the sale and company’s revenue.
It doesn’t matter whatever field of business you’re in, there’s always competition in the market. Kohls, TJ Maxx, and Nordstrom are some of the top competitors of the company in the retail chain category. However, they’re always after Macy’s to gain a competitive edge in terms of market share, profitability, or any other way.
Macy’s had faced a loss of roundabout 1.1 billion dollars during the pandemic of covid-19. It was something that no one was expecting, and it hit businesses to a great extent. The lockdown, social distances, and protocols have made it difficult for the company to run its businesses smoothly.